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AR IN SO in France. Best in France Case Study September 2003 - May 2004 . Team MBA BSi: Rachel ROSA Martial FEVRIER José R. VALENZUELA Christophe VANIER. The Best in France case study aims at : Identifying what adaptations firms must make when opening business units in France,

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ar in so in france

ARINSO in France

Best in France Case Study

September 2003 - May 2004

  • Team MBA BSi:
  • Rachel ROSA
  • Martial FEVRIER
  • José R. VALENZUELA
  • Christophe VANIER
purpose
The Best in France case study aims at :

Identifying what adaptations firms must make when opening business units in France,

Assisting students, companies and government ministries by identifying and benchmarking managerial strategies that add value to the French economy and to firms operating in France,

Creating a database of the detailed studies, available to the participating firms.

Purpose

Best in France Case Study

executive overview
Success Story & Key numbers

Arinso Business Model

Company Products

Operating Strategy

Arinso Clients

Why did Arinso come to France

Arinso values in France

Constraints in France

Adaptation to France

Key Costs of France

Key Benefits of France

Arinso’s Essential Advice

Executive Overview

Best in France Case Study

arinso success story
Arinso Success Story
  • 1994 : creation of ARgus INtegrated SOlutions in Belgium by Jos Sluys (former SAP executive)
  • Creation of international subsidiaries
    • 1996 : France, Nederland
    • 1997 : USA, Luxemburg
    • 1998 : UK, Canada and Spain
    • 1999 : Italy
    • 2000 : Germany, Portugal, Morocco, Argentina, Mexico, Brazil, Asia-Pacific (Singapore, Malaysia, Thailand)
    • Swiss, Sweden, Finland, Poland (October 2003 )
  • Gone public in 2000 (Euronext Brussels: ARIN)

Best in France Case Study

international coverage
International Coverage

22 Countries on 5 Continents

Best in France Case Study

key corporate numbers
Key Corporate Numbers
  • 10 years of existence
  • 22 countries of operation
  • 1300 Employees Worldwide (177 in France)
  • 121 M€ turnover * (France #1 with 25M€)
  • 11% EBIT * (to sales)

* Annual Report 2002

Best in France Case Study

ar in so business model
Arinso Business Model

4%

10%

10%

  • 22 countries, 1 business model, 3 key activities:
  • HR systems integration
  • HR Operations
  • HR Strategy
  • French affiliate:
  • Sales breakdown today
  • (total sales 25M€)
  • Target breakdown
  • Market share

89%

45%

15%

7%

45%

1%

Best in France Case Study

ar in so products services
Arinso Products/Services
  • HR IS Integration:Arinso is an established partner of the leading providers of HR management solutions
  • ERP: Establishing the foundations
    • Implementation
    • Integration
  • e-HR: Streamlining administrative processes
  • Enterprise Portals: Optimizing work environment

Best in France Case Study

ar in so products services1
Arinso Products/Services

HR Strategy:Transforming HRM to deliver Business Strategy

  • HR business analysis
  • HR process improvement
  • Transformation management

Best in France Case Study

ar in so products services2
Arinso Products/Services

HR Operations:Helping clients build more HR value

  • HR Shared Service Centers (HRSC)
  • HR Technical Business Process Outsourcing (TBPO)
  • HR Business Process Outsourcing (BPO)

Best in France Case Study

operating strategy
Operating Strategy
  • Products:
    • Software tools (global offer)
      • Design in Belgium
      • Coding & maintenance in Malaysia(lower labor costs)
    • Bespoke developments (sold in France)
      • Local design
      • Coding in Morocco, India, Malaysia (lower labor costs)
  • Services sold in France:
    • HR Strategy consulting  Locally
    • HR Integration consulting  Locally
    • HR Operations
      • HR Shared Service Centers  Atlanta, Brussels
      • Business Process Outsourcing  US ( Atlanta ), CAN (Montréal ), SPAIN ( Barcelona Call center ) + Shared Service Centers
      • Technical Business Process Outsourcing  US ( Atlanta ), BEL ( Brussels )

Best in France Case Study

clients
Clients
  • Who are they?
    • Big multinational groups
    • Local companies
  • What do they expect?
    • HR Transformation:
      • Systems
      • Organization
      • Processes
    • Better value at lower cost
  • How a presence on the French ground helps satisfying customers?
    • Requirement to know the French HR regulations
    • Minimize cultural gap (for sales & consulting)

Best in France Case Study

clients1
Clients

Arinso counts 90+ clients in Fortune Global 500

Best in France Case Study

clients some big names
Clients: Some Big Names

Best in France Case Study

why coming to france
Why coming to France?
  • Demand from global clients for Arinso to roll-out projects for all of their affiliates  international expansion plan
  • Belgian market would have quickly become too small
  • French market was big & new (and need to be in France to deal with French customers)
  • Proximity
    • Geography
    • Language
  • Being in France seemed a must for a company with international ambitions

Best in France Case Study

company values
Company values
  • Core values:
    • Value creation
    • Harmony
    • Humility
  • Anticipated conflicts with France: Humility vs French culture
  • Verified good fit with France: Value creation (from the education system obviously ; French university)

Best in France Case Study

company values1
Company values
  • Values instilled in France the same way as anywhere else:
    • Through the personality of the charismatic founder & CEO
      • Customer-oriented, efficient, hardworking, …
      • Academy-type management, clear communication, …
      • Close to the base, always flying in economy class, …
    • Through the structure of the organization
      • Flat, reactive, identifying & rewarding potentials, dropping dead weights, …
      • Homogeneity in organizational structure, business model and bonus plan structure across countries, …

Jos Sluys

Best in France Case Study

constraints in france
Constraints in France
  • Expected constraints: Costs
    • Structure
    • Labor
  • Some more discovered after settlement
    • Rigidity of labor regulations (increased even more since 1996)
    • Employer-Employee relation not easy to manage
    • Poor language skills of French professionals (even young grads)
    • More requirements from young graduates:
      • compensation & benefits (1999-2001)
      • little flexibility (still true)
    • Backing of the value “labor” in the French society
  • Worst constraints
    • Labor costs (35hrs/week)
    • Lack of of flexibility and decrease of professional commitment
    • Operations management made more complex from 35 hrs/week

Best in France Case Study

constraints in france1
Constraints in France
  • Difference with other locations
    • Labor costs: Profit margin
      • France/Luxemburg = 1/5
      • France/Belgium = 1/4
      • France/Holland = 1/4

215 workdays/yr in France vs 240 in the majority of the rest of Europe

    • Far better flexibility in the UK, Holland, Belgium…
    • Labor regulations and social environment better than France anywhere else apart from Italy and Germany
  • Lost opportunities outside France? Why?
    • Not competitive on labor costs
    • Poor language skills
    • Low flexibility of employees and need more coaching abroad

Best in France Case Study

adaptation to france
Adaptation to France
  • Recruitment/Selection

Errors cost much  recruitment process kept internal

  • Compensation
    • Implementation of attractive packages (company car, stock-options, profit-sharing)
    • Increase of the variable part of remuneration for some positions
  • Management Development
    • Setup of a middle management
    • Good technical culture need to be more Project cultured (most projects are fixed-price nowadays)  Training on Project Management
  • Workforce Planning
    • Recruitment: Quarterly plan
    • Management succession: No planning
    • Delocalization of low-margin activities abroad (near-shore / off-shore)

Best in France Case Study

adaptation to france1
Adaptation to France
  • Motivation
    • Initiation of a career plan process
  • Communication policies
    • External: PR agency
    • Internal
      • Formal “Company” or “Business Unit” meetings
      • Informal get-together evenings (restaurant, bar, cultural event, …)
  • International transfers, use of expatriates
    • 20 French employees abroad / 180
    • Lots of impatriates (international projects on the French ground)
    • Training of Moroccan technical engineers in France
  • Training

Quite substantial training budget (Structural & cultural expectation for training and career development in France)

Best in France Case Study

key costs of france
Key Costs of France
  • HR type costs
    • Hiring
    • Paying
    • Training
    • Dismissing
  • Structural Costs
    • Offices
    • Taxes
  • Communication constraints
    • Poor foreign language skills

Best in France Case Study

key benefits of france
Key Benefits of France
  • Product/Service quality
    • Very high productivity (education, mindset, behavior)
    • “Must” country for customer image
  • Revenue/profit
    • Revenue increase
    • Profit decrease

 Re-positioning on high value-added activities

 Watch out for structure costs

  • Location benefits
    • quality of life (impatriates do not wish to leave France)
  • Market Potential
    • customer demands for cultural adaptation of product(s)

Best in France Case Study

france vs corporate
France vs Corporate

Figures of 2002

Best in France Case Study

essential advice
Essential Advice
  • Before coming to France
    • Project & analyze profit margin (operating costs : costs of sales + other expenses )
    • “Paris vs. rest-of-France ?”
  • Adaptation while in France
    • Capacity to adapt to regulatory constraints
    • Prudence and anticipation (small errors can have greater consequences than in any other country)

Best in France Case Study

we thank
We Thank
  • Denis TOURNESAC, Managing Director Arinso France, denis.tournesac@arinso.com
  • Catherine AIELLO, Finance & HR Director France, catherine.aiello.verniere@arinso.com
  • Olivier CARPENTIER, Operations Director France, olivier.carpentier@arinso.com

ARINSO France

Espace 21

31, Place Ronde

F-92986 Paris La Défense 7

Tel: +33 (0)1 49 00 31 31

http://www.arinso.com

Best in France Case Study

bibliography
Bibliography
  • References:
    • Arinso website

http://www.arinso.com

    • Arinso Annual report 2002 http://www.arinso.com/Downloads/annual_report_2002_eng.pdf
  • Appendix
    • Questionnaire

Best in France Case Study

our team
Our Team
  • Rachel ROSA, rachel.rosa@mailhec.net
  • Martial FEVRIER, martial.fevrier@mailhec.net
  • José Ramon VALENZUELA, ramon.Valenzuela@mailhec.net
  • Christophe VANIER, christophe.vanier@mailhec.net

HEC School of Management

1, Rue de la Libération

78351 - Jouy en Josas Cedex

Tel: +33 (0)1 39 67 70 00

http://www.mba.hec.fr

http://www.hec.fr

Best in France Case Study

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